(RTTNews.com) - Consumer prices in the U.S. increased by slightly less than expected in the month of September, according to a report released by the Labor Department on Friday.
The Labor Department said its consumer price index climbed by 0.5 percent in September after rising by 0.4 percent in August. Economists had expected prices to increase by 0.6 percent.
The increase in consumer prices was largely due to a jump in energy prices, which soared by 6.1 percent in September after jumping by 2.8 percent in August.
Excluding food and energy prices, core consumer prices inched up by 0.1 percent in September after edging up by 0.2 percent in August. Core prices had been expected to rise by another 0.2 percent.
The uptick by the core index reflected higher prices for shelter, motor vehicle insurance, recreation, education, and wireless telephone services.
On the other hand, the Labor Department said prices for new vehicles, household furnishings and operations, medical care, and used cars and trucks fell during the month.
The report said the annual rate of growth in consumer prices accelerated to 2.2 percent in September from 1.9 percent in August, while the annual growth in core consumer prices held at 1.7 percent.
"Overall, with temporary factors weighing on core inflation and the activity data still suggesting that economic growth is strong, we still think that the Fed will press ahead and raise rates in December," said Michael Pearce, U.S. economist at Capital Economics.
He added, "Once those factors fade in early 2018, and against the backdrop of exceptionally tight labor market, we suspect that core inflation will rebound in 2018."
On Thursday, the Labor Department released a separate report showing producer prices increased in line with economist estimates in the month of September.
The Labor Department said its producer price index for final demand climbed by 0.4 percent in September after edging up by 0.2 percent in August.
Excluding food and energy prices, core producer prices still rose by 0.4 percent in September after inching up by 0.1 percent in August. Core prices had been expected to rise by 0.2 percent.
The report also said the annual rate of producer price growth accelerated to 2.6 percent in September from 2.4 percent in August.
The year-over-year growth in core consumer prices also accelerated to 2.2 percent in September from 2.0 percent in the previous month.
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